Women in Punjab fight against High Interest Micro-Finance Company Loans

A struggle by women against micro-finance companies has been going on in Mansa (Punjab) and near-by Districts since 13 May 2020 led by the Mazdoor Mukti Morcha.

Mazdoor Mukti Morcha State President Bhagwant Singh Samaon said that women in hundreds of villages in the Malwa region of Punjab are organizing themselves against this usurious exploitation. Similarly, MMM activists in Majha region of Punjab Vijay Kumar Sohar told that this movement has taken hold in Gurdaspur region also; meetings have been held at 300 villages and a rally was organized at Dhariwal in which 400 women participated. 11 rallies and protests have also been organized at Mansa and Bathinda with a total participation of tens of thousands of women. A protest on 10 June was also organized at Fetehabad in Haryana led by CPIML, AIPWA and RYA leaders Sukhvinder Singh, Gurpreet Singh Gopi, Jasbir Kaur Natt and Happy Ratiya.

Micro-finance companies give needy urban and rural women loans (in groups of about 20 each) starting from Rs 15000 and going up to Rs 75000 which they have to return in two years in weekly or fortnightly installments. Often, the loan amount gets spent for household purposes due to poverty and lack of income, and repayment becomes very difficult. Moreover, the interest rates are 25% to 31%, so high that repayment is almost impossible. The companies understand this reality and they have some modus operandi to extort profit even from extremely deprived sections of population. They cut the first instalment from the original loan amount and also collect Rs 1500-2000 in the name of file charges. All the women in a group are responsible for timely repayment by each individual woman, failing which the group would be blacklisted. This results in a huge amount of social and peer pressure on the women who are unable to repay. The companies would ‘solve’ this issue by giving a new and bigger loan, but first cutting the previous amount owed by the women. Thus the companies were able to run their business successfully.

With the Lockdown, the income of poor families became zero. There was no way the women could repay the installments. Field agents of these companies, who also do the job of bullying, would go to the women’s houses and put pressure for repayment. This situation led the women to join organizations which would fight for them. Interestingly, the women whom the companies had made the group leaders are the ones who are now leading the struggle. These women leaders include Anganwadi, ASHA and midday workers.

The initial demand of the SHG women was that installment repayment for the Lockdown period should be waived. But as the struggle progressed, the demands included complete loan waiver, Rs 10000 monthly relief amount for all poor families during the Lockdown period, interest free loans, and banning on harassment by micro-finance companies.

Under pressure from the women’s struggle, many District Magistrates in Punjab have declared, on the basis of an order issued by the RBI, that if any company tries to pressurize women till August for repayment, a police case will be registered against the company. However, the struggle is still on with the rest of their demands, though there has been some let up after 10 June when the sowing season started. CPIML and Mazdoor Mukti Morcha have decided that a mass rally and meeting will be organized at Mansa on 28 July to carry forward this struggle.

- Sukhdarshan Natt